Are you about starting a fashion design company? If YES, here is a complete sample fashion design business plan template & feasibility report you can use for FREE.
Okay, so we have considered all the requirements for starting a fashion design company. We also took it further by analyzing and drafting a sample fashion design marketing plan template backed up by actionable guerrilla marketing ideas for fashion design companies. So let’s proceed to the business planning section.
Why Start a Fashion Design Business?
Fashion is one aspect that cannot be done without especially in an age where different age groups all have a large percentage of them that are geared to fashion. A fashion design business is a business for entrepreneurs who are creative and enterprising in nature.
These individuals understand the fashion world such as the importance of texture, color, and shape in varied clothing as well as the business of ensuring that this creativity yields revenue and eventually profit. Also, before starting this business it is vital that you write out a business plan that is comprehensive in nature.
There are two ways at ensuring that you get a business plan that is comprehensive enough to show your investors your seriousness and this is either hiring a business plan writer to write one for you or going online to get a free fashion design business plan template to aid you in writing. Below is a sample of one;
A Sample Fashion Design Business Plan Template
1. Industry Overview
The fashion design industry has no companies with a dominant market share in the industry. The industry is one that has generated revenue of $2 billion with an annual growth of 7.2% for between the periods of 2011 to 2016. In the united states of America, there are more than 19,000 fashion designer businesses employing nearly 27,000 people.
The fashion design industry is one that has trended toward growth in the last years between 2011 and 2016. This is due to the fact that designers in order to appeal to large section of their target market have started closing the gap between style and value.
The industry is still projected to grow between the periods of 2017 to 2022, and the revenue in this industry will grow too depending on increasing consumer confidence and the rising per capita disposable income. More than two-thirds of the establishments in the fashion design industry are located in three states – New York, Florida and California.
New York comprises 28.7% of the total industry establishments and is the home to major designers, elite fashion schools and brand labels. The city is also one that has a high number of retail outlets that are of high end.
There are various upcoming trends that is likely to affect the fashion design industry and might influence employment in this industry and they include; improved use of the internet for online shopping by customers, continued use of cheap labors and consolidation of businesses in the retail sector.
According to the Bureau of Labor (BLS) Statistics, as at 2014, one in about four fashion designers owned their own businesses, and was able to set up their own independent clothing lines. Employment in the fashion design industry was projected to grow at 3% from 2014 and last till 2024 on that same percentage which was deemed slower than the average compared to most other industries.
2. Executive Summary
Davica Fashion Design LLC is established to intrigue our clients with our fashion pieces while also identifying with the uniqueness in each of our clients. Our aim is to become a worldwide brand name in the 2023 here in Midtown Manhattan – New York.
We therefore are in business in order to generate revenue, make profit whilst also favorably competing with other leading brands in the fashion design industry in seven years time.
Our location in Midtown Manhattan – New York is a very strategic one as we are located in the hub of the fashion industry and with the right strategies and plans that we have in place, we are sure of meeting, achieving and exceeding our desired goals and intentions.
Our publicity strategies are top notch as we have hired the services of a brand consultant to help us draft the strategies that will make us stand out from similar fashion design businesses in the industry.
Our intention of achieving this vision is in going the extra mile to hire the right management team that understands our core vision and principles as a business and willing to ensure that these values are clearly communicated and implemented by the non-management staff in the organization.
We intend to build a solid business structure by ensuring that we hire professional and competent employees that understand the business and industry thoroughly and are also committed to seeing that we achieve our intended goal through increased productivity.
Seeing as technology has come to stay, we will be deploying the right technology that will help us become efficient in producing the right designs, while also getting the right and recent equipment are procured for use in increasing productivity.
Finally, our owners, David Kork and Vivica Sox have the right amount of fashion and business experience needed to ensure that Davica Fashion Design LLC become the brand leaders it intends to be.
David is a creative fashion designer and has been producing designs for 5 years, while Vivica has more experience in management and will be in charge of making decisions that will have an effect on the business, she has over 10 years experience in management, with 4 years in a fashion design business.
3. Our Products and Services
At Davica Fashion Design LLC, we intend to ensure that we deal in all forms of unique fashion designs and accessories in our primary location here in Midtown Manhattan – New York. We intend to ensure that we create multiple sources of income that will be in line with our core service; these other services might be intangible in nature and include services such as trainings and consultancy services.
Our intention of creating multiple sources of income is so that we would be able to boost the bottom line of our business as is permissible under the laws of the United States of America. Therefore, some of the products and services we intend to offer are;
- Sale of fashion design wears for certain ages and sexes
- Sale of fashion accessories
- Consultancy and advisory services
4. Our Mission and Vision Statement
- Our vision is to intrigue our clients with our fashion pieces while identifying with the uniqueness in each of our clients.
- We also intend to become a worldwide brand name in the year 2023 here in Midtown Manhattan – New York.
- In order to achieve our vision, we have laid down procedures that would ensure that most of our target market is aware of our products.
- We also have competent and professional employees that would ensure that that our vision is actualized.
Our Business Structure
In order to ensure that we set up and run a standard fashion design business here in Midtown – Manhattan – New York, we intend to get it right from the beginning by ensuring that we build a business structure that is in line with our core values and which will ensure that we can run all our intended services smoothly without hitches.
As such, we intend to ensure that we hire the right employees who are hardworking and competent and who not only understand the industry thoroughly but also the business and our core values and principles and will therefore ensure that we get to the attained level of goals and objectives through their commitment and dedication.
Also, since we intend to offer a wide range of services for our fashion design business, we will need to employ several employees who now and understand each task they are to handle. We also will pay our employees very well and ensure that they are well trained in order to be able to handle the different and increasing responsibilities assigned to them.
Therefore, the business structure we intend to build at Davica Fashion Design LLC is;
- Chief Executive Officer
- Fashion Manager
- Human Resources and Admin Manager
- Purchasing Manager
- Inventory Manager
- Marketing and Sales Executives
- Customer Service Executives
5. Job Roles and Responsibilities
Chief Executive Officer
- In charge of making strategic decisions that would affect the overall direction of the company
- Liaises with high end clients on behalf of the organization.
- Ensures that company policies are reviewed to remove or modify those that aren’t working
- In charge of creative designs by the company
- Liaises with magazine editors, other fashion managers, organizers of pageants and catwalk on behalf of the company
- Remains updated about industry trend so as to predictably forecast what would be fashionable and design same for the company
Human Resources and Admin Manager
- Carries out administrative tasks that ensures that the company runs smoothly
- Sources for and recruits the right employees on behalf of the company
- Conducts employee orientation and training
- Sources for reliable vendors and manufacturers on behalf of the company
- Drafts negotiation documents that would be used to secure the materials on behalf of the business
- Looks for back-up vendors and manufacturers on behalf of the company
- Checks the raw materials and ensure that depleted stock are replenished
- Monitors and documents outgoing materials and incoming materials
- Ensures that storage is well ventilated and that the materials are in the right condition always
Marketing and Sales Executives
- Conducts appropriate market research in order to determine new target markets on behalf of the company
- Conducts direct marketing to clients on behalf of the company
- Drafts and reviews marketing strategies for the company and removes ineffective strategies
- Controls the amount of physical cash used by the company to carry out certain activities
- Ensures that the ban statement and the cash boo are appropriately reconciled at month end
- Prepares all financial information and statements as well as tax reports on behalf of the company and carries out internal audit as well
Customer Service Executives
- Ensures that all customer enquiries, orders and complaints are promptly attended to
- Keeps an updated customer database on behalf of Davica Fashion Design LLC
- Keeps up with industry trends so as to have the right knowledge when attending to clients
- Ensures that the office premises are clean before the start of business each day
- Restock depleted cleaning supplies
- Carries out any other duties as might be determined by the admin manager
- Monitors the loading and offloading of materials in and out of the truck so as to ensure that it tallies with documentation
- Ensures that materials and designs as well as other accessories are delivered to the accurate locations each time
- Carries out any other duties as determined by the admin manager
6. SWOT Analysis
Making a honest assessment of our business concept by pointing out the advantages and weaknesses we have will allow us know if we are taking the right step into starting this business, and as such we hired the help of a reputable business consultant here in Midtown Manhattan – New York.
In looking critically at our business concept, the business consultant used the popular SWOT (strengths, weaknesses, opportunities and threats) analysis to determine how suitable we were for the industry. Below is the result of the SWOT analysis that was conducted on behalf of Davica Fashion Design LLC;
Our strength lies in the fact that we create unique designs for our various clients to meet their tastes and preferences, as well as other fashion related services. Our several marketing and publicity strategies are already enabling us stand out from the others in the industry.
Also, we have hired competent employees who are not only professionals but have the necessary expertise to enable us meet our intended goals and objectives. Also, our owners, David Kork and Vivica Sox have the right amount of fashion and business experience needed to ensure that Davica Fashion Design LLC become the brand leaders it intends to be.
There are certain factors which we have perceived as weaknesses to our business and that is the fact that we are located in a fashion hub as New York, especially as Manhattan is one of the hottest fashion hubs. Also, the industry is a bit saturated as there are enough fashion design businesses in and around New York.
There are several opportunities that abound for our fashion design school such as ability to showcase our designs to the world through fashion shows and pageantries as well as celebrity endorsement. Also, the internet is offering us vast opportunities that will enable us showcase our designs to clients in far locations.
While the fashion industry might seem fun and glamorous, there are threats that the industry faces every now and then and as a business we are well prepared to meet any threats we might face during start up and whilst running the business.
Some of the threats we are likely to face are scarcity of the raw materials, unreliable vendors as well as arrival of more competitors into the market. We have however laid the right strategies that will ensure that we surmount any challenges that we are likely to face during the course of starting or running the business.
7. MARKET ANALYSIS
- Market Trends
The fashion industry is a glamorous and fun industry that is competitive in nature. Running a fashion design business is time consuming and most fashion design businesses usually fail because the entrepreneurs do not have the wherewithal to be creative and run the business at the same time.
This is because any entrepreneur starting this business usually spends less time designing, and more time managing production, dealing with suppliers, sending clothes to magazines, and managing the employees’ in-between. It usually takes an entrepreneur who has been into the business before to be able to successfully handle the business.
This kind of business is one that requires endurance and tenacity because this is a hyper competitive and complex industry, in which any start-up business can have suppliers and customers in the short period of time of starting the business.
Which is why to succeed in this industry you would need to be committed first as the chief executive officer before being a fashion designer. However, this does not mean that you do everything yourself, as most fashion design businesses usually hire a chief executive officer to handle the administrative affairs so that the owners can focus on fashion designing.
Finally, fashion designing in the real business world is different from that learnt in school. Starting and running a fashion design business would mean you developing and ensuring you follow a creative process that is organized, which is why most entrepreneurs looking to start their own business usually work as interns in larger fashion houses so as to be able to understand the methodology required in running the business.
Another option when starting this business especially if you are just skilled in fashion designing is to find a partner that is skilled in business in order to help manage the business part of the business.
8. Our Target Market
The fashion industry is one where there are various range of available customers of both sexes and ages. However, we do not intend to design clothes for everyone as we intend to choose our market segment in the target market.
However, to help us know the right clients we intend for our business and also know what it is they expect from us, especially as regards our location here in Midtown –Manhattan – New York; we intend to conduct a thorough market research that would allow us draft the right strategies that would suit this market.
From the result of our marketing strategy, we would be engaging in our fashion design business in order to cater to the following group of people;
- Music and movie celebrities
- Business People
- Men and female adults
- Young adults
- Movie producers
- Fashion houses
- Retail stores
Our competitive advantage
Davica Fashion Design LLC is a business that hopes to be a contending leader in the fashion industry by 2023 by offering unique quality designs to its customers here in Midtown Manhattan – new York as well as all around the United States of America.
We intend to offer only the best to our target market by conducting a research to know what our existing and intending clients’ wants and ensure that we not only meet but surpass their expectation.
We intend to ensure that we hire professionals and competent employees who do not only understand the industry but are also committed to our organizational cores and values and are committed to ensuring that we reach our desired goals and objectives.
We will also pay our employees very well as we would ensure that their welfare packages are the best that can be gotten amongst similar fashion design businesses both here in Midtown Manhattan – New York as well as all over the United States of America.
Lastly, we intend to offer the best customer care for our various customers and ensure that all our customer care executives have updated knowledge about industry trends so as to use this knowledge to better serve and ensure that our customers get what they want.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Davica Fashion Design LLC is a fashion design business that has been established with the aim of generating revenue and making profit in the fashion industry in the United States of America. We intend to ensure that we offer various in order to meet the various needs of our customers.
Therefore, we intend to generate income for Davica Fashion Design LLC by offering the following services;
- Sale of fashion design wears for certain ages and sexes
- Sale of fashion accessories
- Consultancy and advisory services
10. Sales Forecast
The fashion industry is one that will always see a surge in demand especially as almost everyone on earth is fashion conscious either through what they put on or see others put on.
New York is one of the cities that is regarded as a fashion hub, therefore our location in Midtown – Manhattan is very strategic and will offer us the right opportunity at ensuring that we not only generate our revenue but that we start to make profit to cover all basic expenses and loan repayments during the first year of business.
In carrying out a sales forecast for the company, we have been able to critically evaluate the fashion industry in order to understand how we would likely fare once our business starts up. The various data gotten from the feasibility study were based on data and information that was gleaned from similar start-ups such as ours here in Midtown Manhattan – New York.
Below therefore is the sales projection that was conducted for Davica Fashion Design LLC;
- First Fiscal Year-: $270,000
- Second Fiscal Year-: $450,000
- Third Fiscal Year-: $900,000
N.B: It should be noted that the above projections were conducted based on several factors such as there would no arrival of competitor during the time of the projections, as well as the fact that people would continue to love our brand. Should there be any change in the factors, it would lead to an increase or decrease in the figures.
- Marketing Strategy and Sales Strategy
Marketing is very important and so it is therefore pertinent that the right marketing strategies are drafted in order to achieve the desired results.
However to be able to draft the right marketing strategies, we have conducted a thorough market research that will allow us not only understand the industry, but also ensure that we penetrate the market and attract the number of customers that we should with our services while ensuring that we are able to compete with other fashion design businesses both here in Midtown Manhattan – New York and in the whole of the United States of America.
Asides from generating revenue and ensuring that one can compete favorably against its competitors, marketing is also used to create awareness for the business for existing and potential customers.
This is why marketing is an aspect of the business that should be taken seriously as poor strategies could lead to failure of the business or dwindling sales due to poor efforts of the marketing team in increasing awareness and invariably sales on behalf of the company.
Due to this, we have secured the help of a reputable marketing consultant here in Midtown Manhattan – New York who not only understand the business but the whole fashion industry and will also help in drafting effective marketing strategies that would be needed to penetrate the target market and get a huge share of our niche market.
We have also empowered our marketing executives to ensure that they ensure that right strategies are drafted on behalf of the company and in line with our core ethics and values. The marketing and sales team also has the power to modify or eliminate strategies that are deemed not to be working on behalf of the company.
Therefore, the strategies we intend to adopt while marketing our services at Davica Fashion Design LLC are;
- Ensure that we introduce our fashion design business to fashion houses, large scale magazine editors as well as other stakeholders in the industry here in Midtown Manhattan – New York, as well as all over the United States of America
- Ensure that we place adverts on local newspapers, fashion and beauty magazines as well as on radio and television stations
- Empower our marketing and sales team to engage in direct marketing on behalf of Davica Fashion Design LLC
- Ensure that our business is listed on both offline and online directories
- Distribute handbills and fliers in conspicuous places in order to promote our business
- Use the internet especially our website to promote our business
11. Publicity and Advertising Strategy
The fashion design business is one that needs a lot of publicity especially as the business industry is one that is very competitive.
Any business that does not take its publicity seriously will likely die or not make it in business. we therefore intend to ensure that we intensify publicity for our businesses in order to increase awareness for our products as well as promote Davica Fashion Design LLC, positively.
We intend to hire a brand consultant who is reputable and has the knowledge regarding this industry to help us draft the right strategies that would promote our fashion design business and also increase awareness for us with our clients – both existing and potential.
The strategies will also be one that identifies with our core values and principles as a business. Therefore the strategies we intend to deploy in promoting and advertising the Davica Fashion Design LLC are;
- Throw a large fashion themed party in order to create awareness about our fashion design business
- Engage in community activities and sponsor relevant programs
- Create a website that is interactive and use that to create awareness about our business
- Ensure that we use social media platforms such as Instagram, Twitter and Facebook to vigorously promote Davica Fashion Design LLC
- Ensure that we place adverts on local newspapers, fashion and beauty magazines, as well as on radio and television stations
- Engage in fashion shows, beauty shows and catwalks and other shows in order to create awareness about Davica Fashion Design LLC
- Ensure that all our staff members wear customized clothes with an attractive design in order to promote our business
12. Our Pricing Strategy
In determining the prices for our fashion design products, we would fix our prices depending on the type of apparel and the design used.
Normally the prices for our fashion design wears depend on the type of clientele. Determining the prices for any product or service depends on several other factors such as what the competitors are offering, what our overheads are, and how much we are getting our raw materials for.
However, in order to attract the right customers to our fashion design business, we intend to lower the prices for the first 6 months and also give some well known celebrities some of our unique designs to wear for free in order to help with promoting our brands.
However, having carefully looked through our strategies, we are pretty sure that our profit margins for the months we intend to lower our prices and offer discounts will not really be affected.
- Payment Options
Because we intend to have a whole lot of customers, we at Davica Fashion Design Business have come up with different payment options so as to suit the different styles and preferences of our customers. Therefore, the payment options that we intend to make to all our customers are;
- Payment via cash
- Payment via check
- Payment via credit card
- Payment via Point of Sale (POS) Machine
- Payment via online payment portal
The above payment options that we have chosen are ones that will help us achieve all our plans without any hitches whatsoever for our customers as well as ourselves.
13. Startup Expenditure (Budget)
In starting a new business, there are certain aspects of the business the bulk of the capital is spent on. In starting our fashion design business and running it to a certain standard, we expect to spend the bulk of our capital on raw materials, leasing a facility, paying the salaries of employees as well as utility bills.
Therefore the key areas where we intend to spend our start-up capital on are;
- Total fee for registering the business in the United States of America – $750
- Obtaining of licenses and permits as well as accounting software – $1,250
- Cost of hiring a business consultant – $1,500
- Marketing promotion expenses (grand opening expenses and general marketing expenses) – $3,000
- Insurance coverage (workers’ compensation, general liability) – $2,000
- Operational cost for the first 6 months (salaries of employees and payment of utility) – $100,000
- Other start-up expenses (stationery, phones, computers, and printers) – $500
- Cost of start-up inventory (raw materials, design accessories, table, shelves, bins, and cash register) – $20,000
- Cost of purchasing a fairly used vehicle – $5,000
- Leasing a facility for the period of one year – $50,000
- Cost of launching a website – $500
- Cost of throwing a grand opening party – $1,000
- Miscellaneous – $5,000
From the above analysis, we would need an estimate of $190,500 in order to successfully start and run our fashion design business here in Midtown Manhattan – New York. It should be noted that the bulk of our capital would be used to pay employees salaries for a period of six months, lease a fairly used vehicle as well as lease a facility that we would use for the period of one year.
Generating Funding / Startup Capital for Davica Fashion Design Business
Davica Fashion Design LLC is a business started and run by two friends, David Kork and Vivica Sox. Both are fashion designers with a degree in business and so have decided to seek for several sources whilst looking for funds in starting our business.
We have therefore decided to restrict the sources of start-up capital to 4 major sources. Therefore the areas which we intend to generate our start-up capital;
- Generate part of our start-up capital from our personal savings
- Source for soft loans from family members
- Apply for loan from the bank
- Apply for loan from a private investor
N.B: We have been able to generate the sum of $20,500 from our personal savings. We sourced for the sum of $10,000 from our family members and friends. We applied for a loan of $110,000 from our commercial bank. All the approving documents needed in ensuring that the loan gets credited to our account have been signed.
The bank loan is expected to be repaid in 5 years at a 2% interest rate. Also, we approached a private investor in the fashion industry, who is interested in mentoring us whilst also giving us a loan of $50,000 for our business.
14. Sustainability and Expansion Strategy
Every business is not only established to fill a need, compete favorably against competitors or generate revenue that will ensure that it makes enough profit but a business is also established that it might exist for as long as the owners want it to and even grow and expand as well.
However, in other to sustain a business there are several factors such as competence of employees, reinvestment strategy as well as retaining of loyal clients amongst others that will be deployed to ensure that the business continues in existence.
Sourcing for and hiring competent employees is very important because having the right employees will lead to a growth in the business and ensure that there are less hiccups for the business during the course of start-up. We will ensure that our employees undergo continuous training and also that our human resources manager conduct performance appraisals every now and then in order to ensure that productivity is attained for the company.
Also, we intend to pay our employees very well, as their welfare packages are already the best as could be attained across the industry for similar start-ups such as ours. To ensure that our business grows to the standard that we intend for it, we intend to re-invest our profits back into the business.
This act will enable us boost our bottom line and ensure that we can suitably expand when we need to. Our re-investment strategy is carefully planned as we also intend to pay back our loans during this period. Finally, we know how important our customers are to our business, because without our clients our fashion design business will not exist.
We therefore intend to offer our clients incentives that will ensure that they become repeat customers. Also, we have trained our customer service executives to be able to handle our customers no matter the situation.
Our customer service is already adjudged the best in the industry for a new start-up regardless of the fact that we haven’t been long in the business. We now that if we carry out these measures, we are likely to not only sustained but also expand our business as well.
Check List / Milestone
- Business Name Availability Check: Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting feasibility studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
- Recruitment of employees: In Progress
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business both online and around the community: In Progress
- Health and Safety and Fire Safety Arrangement (License): Secured
- Opening party / launching party planning: In Progress
- Establishing business relationship with vendors – wholesale suppliers / merchants: In Progress
- Purchase of trucks: Completed